Home Insurance

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That’s what the Guardian says, anyway. (scroll down to 2nd story)

You’ve probably seen these home insurance ads all over the TV.* Barclays home insurance promises to beat your quote – if they can’t they’ll drop their price by up to £100 and give you £50. Of course it’s not nearly as simple as that. Reading the full terms and conditions you begin to get an idea of how complicated Barclays have made it. Rather than knocking the money of the premium, the promotion works on a “cashback” style basis, so you have to pay them the full amount first – which may well be more than your renewal – and then you have to remember to send them proof of your previous renewal offer. Finally you have to wait “up to 28 days” for your cheque to come back, go to the bank, pay it in and wait a further 3 days for it to clear. In the meantime Barclays have your money which they can earn interest on in the meantime. And of course, at each stage some people will forget to do one of the necessary steps and Barclays just keep the money.

But look what happens the second year. In their marketing spiel, Barclays say, “Next year if you remain claim free, we’ll promise to beat our first year quote.” But remember, the first year quote may actually have been more expensive than you were paying in the first place. And as the example in the Guardian shows, there’s a good possibility that Barclays won’t come near your existing premium anyway. Indeed, if the journalist had been dumb enough to go ahead with Barclays, he’d have been down £238 overall, assuming that Barclays only dropped their renewal price by £10 or so.

Then there’s the “Challenge Churchill” campaign. In respect of their claim the journalist found that while they did drop the price to match a competitor, they did not match the level of cover for his car insurance.

So the moral of the story is: beware of slick marketing campaigns. Check that no bizarre or onerous conditions are buried in small print, always check your level of cover, and if, when you phone up you find the deal isn’t quite as good as you thought it was, perhaps you should be very wary of proceeding.

  • Daniel

    >It is worrying that big companies such as these continue to try and lure people in with these types of ‘deals’. In my experience I feel people are getting better at seeing through them though. Thanks to sites and blogs like this highlighting the apparent deviousness. I’ve recently started up my own car insurance blog and having read this entry feel inspired to dedicate a few posts to the area of car insurance adverts. I have in fact already discussed Direct Lines advert attacking comparison websites, I’m sure there are other areas to investigate as well!